Ready? Whenever you are. All right. Hi, everyone. Welcome to our fireside chat with Catalyst Pharmaceuticals. My name is Jennifer Kim. I'm one of the Research Analysts here at Cantor. I'm excited to welcome Richard Daly, CEO, and Steve Miller, COO and CSO. Thanks to you both for being here. Thank you, Jennifer. To kick things off, Catalyst, for those who are less familiar, operates under a fairly unique business model. Can you just walk through this business model, why you believe it's worked well, and sort of what you've built over the last few years? Sure. Our business model is easily classified as a buy-and-build model. We believe that this reduces significant risk for the company, obviously for shareholders and other stakeholders as well. We engage with companies that have valuable assets because of our infrastructure and our established infrastructure, not only on the commercial side but also on the patient support side. In orphan and rare, which is where we focus, we are currently focused in CNS. In orphan and rare, that ability to support the patient becomes incredibly important. We look for opportunities to help the patient get on drug, stay on drug, and optimize their therapy. The relationship that we have in bringing these significantly de-risked assets to market, we think, helps us to build a really strong financial position in the market. As such, we have a great balance sheet for a company our size, and we have excellent execution and performance across the board on our therapies as well. Do you want to touch on, I guess, where the company stands right now? Sure. We have three assets, one for Lambert-Eaton myasthenic syndrome. There are approximately, say, for the sake of discussion, about 2,500- 3,000 patients in that market. We have a drug called AGAMREE, for Duchenne muscular dystrophy, with a patient population in the U.S. of 11,000- 13,000. We just launched AGAMREE last year. It's a novel corticosteroid. Steve can get into the discussion about the mechanism of action, why we believe it brings significant value to patients and providers, as well as caregivers. On the Lambert-Eaton myasthenic syndrome side of it, FIRDAPSE is our drug. We have two essential markets. You should think of it as one molecule, but two brands. It operates in the idiopathic LEMS, or non-cancer LEMS side of it in the neurology community. On the cancer side, it operates with the oncologists. The market is split about evenly between those two opportunities. OK. I want to go into the commercial business. Maybe first, taking a step back, with your buy-and-build model, can you just walk through what the thinking is behind the focus on orphan and rare disease? How well does that infrastructure lend itself as you look, I guess, outside CNS as well? Sure. The infrastructure is one where we have an opportunity to work on the commercial side, but also in the patient support space. We have patient advocacy liaisons who work directly with patients through permission marketing. We also have a specialty pharmacy, a hub, and a 3PL, third-party logistic provider, to make sure patients get their drug. These things are universal. Think of it as a universal construct for patient support and driving the business. We believe that these can be applied broadly across the universe of orphan and rare. The thing we like about orphan and rare is the focused commercial effort. Our AGAMREE team is 12 sales representatives for the entire U.S., and our FIRDAPSE team is 16 for the entire U.S. We have a very focused commercial model. We don't do a lot of contracting, therefore, our gross tenets are very favorable for the business. We believe this drives the sustained opportunity. Operating outside of CNS, CNS is a great space to be in, in the orphan space. The challenge for a company of our size is all the growth in the next five years is coming from movement disorders. When we think about movement disorders, we think large companies, and we would be competing for assets with very large companies. Because of the infrastructure we have, we believe we can actually operate that infrastructure in support of any therapeutic area. We're therapeutically agnostic. We look for products that are immediately accretive or nearly immediately accretive, and they have to have a long runway. We don't want something that's going to go generic in two or three years. We want to be able to get a return and develop the relationship with the patient community. That's really important. OK, great. Maybe we can turn to the commercial business. You guys came off a strong 2024. To date, you've maintained your full-year guidance for each of your products. Any key highlights on how each of these assets have performed so far? What gives you confidence for the rest of the year? Sure. Let's start with FIRDAPSE. The product is performing really, really well. We have two significant initiatives here. The first is pretty straightforward. Patients need to titrate on this drug. We've put in, as patients enroll in our specialty pharmacy and hub, we've actually changed the enrollment form so that the physician knows that they need to titrate the patient. The average physician sees one Lambert-Eaton myasthenic patient in their entire career. Their familiarity with it amounts to zero. The opportunity is to get that patient on the right dose and help them titrate to effectiveness. The number one reason why a patient would stop FIRDAPSE therapy is because they pass away. A typical idiopathic patient lives a normal lifespan. The second reason is for lack of effect. We are implementing a number of initiatives to really drive the right dose for the right patient at the right time. It becomes really important when we think about getting them started. That enrollment form is really important. We have now intervention from our pharmacy to the provider. When the provider writes a prescription for a low dose or no titration, they get a call from a pharmacist who's dealt with hundreds of patients. The opportunity is that the seasoned health care professional, the pharmacist, can help this relatively naive and new to therapy physician or nurse practitioner, if you will, to help them understand the best way to move forward. That's what we're really looking for in one element. The second element on the FIRDAPSE side is the cancer-associated LEMS. As we said before, half the business. It's very concentrated. The idiopathic side is prospecting. You have to find the patients. We maintain a pool of about 500 patients. We refresh that and reprioritize that on a constant basis. It represents about half the patients that we get into the business every quarter. It's a very good source. You're always working to find patients. On the cancer side, those patients are centrally located in these very large practices. We have initiated what we call frictionless testing. VGCC is a test that can identify a LEMS patient. We got recently updated in July. We updated the NCCN, updated the guidelines. FIRDAPSE is the only evidence-based medicine that can treat, is approved to treat LEMS. We are now working with these large group practices to incorporate the NCCN guidelines into their care pathways. We are really excited about that. On the AGAMREE side, the opportunity is one where we are looking at gene therapy and all the consternation that surrounds gene therapy. Steroids are the foundation of therapy for patients with Duchenne muscular dystrophy. It is the drug that drugs get added to, not the drug that gets added. It is the foundation. It is the first thing you get. With all of this swirling around gene therapy, it truly is unfortunate. The opportunity becomes, as they scale back to non-ambulatory patients, we can actually move in very, very quickly and adeptly to help those patients. We are working on that right now. That part of the market needs to settle down a little bit for us to have an effect. The product continues to grow in a very robust manner. We are really pleased with the launch thus far. Maybe touch on FYCOMPA? FYCOMPA is an epilepsy drug. I haven't talked about it yet. We bought that drug from Eisai. It came with a very, very talented team. The drug is the only drug in its class. It recently lost exclusivity on the solid dose formulation in late May. Our guidance on that is $90 million- $95 million for the year. In the first six months of the year, we delivered $70 million. We are very confident in delivering on our guidance. However, there are a couple of things that stand out. First, the first generic entrant came about a month after exclusivity expired. We outperformed on that. A second first filer has yet to come to market. There remains a little bit of risk on that product in that regard. We expect two additional solid dose generic entrants in the middle of November. When we think about that, we believe the prescriptions will continue. The ex-factory sales to fill the channel, our ex-factory sales will be replaced by those generics. We expect to have a little bit softer second half, maybe a significantly softer second half because of that channel fill. The oral solution that we have, prior to generic incursion, represents about 15% of our business. That goes generic in the middle of December. We lose exclusivity. There is one generic that will come in. That channel fill will negatively affect our ex-factory sales. We believe our $90 million- $95 million is conservative, but appropriate for now as we see what happens with some of these other filers. All right. Fair enough. Maybe we can dig into the growing products, FIRDAPSE and then AGAMREE. So FIRDAPSE, historically, there were some year-over-year nuances in the most recent quarter. You've hit that 15%- 20% growth pretty steadily in quite a number of quarters. I think 15% is the number. 14% or 15%. 14% or 15%. How sustainable do you see that growth being? What would drive that sustainability? I think some of the programs, we do see it as sustainable for the mid to long term. We look at the initiatives that we put into place. Number one, the titration, which is really important for the patient to experience the benefit, but also the oncology side. Our penetration in the idiopathic side into the total addressable market is 30%. Our penetration into the oncology side is less than 10%. With these changes, with the testing, NCCN guidelines, and then working with these large group practices, we believe we can actually drive further growth for the products. We're excited. The total addressable market at today's prices, with the most conservative estimate for patients' addressable market, is $1.2 billion. I'm sure we're going to talk about the patent issues surrounding the product and the challenges we face. If we solidify and finalize and get those behind us, we would be the only player for a significant amount of time, only evidence-based. We don't see anything in the pipeline. We think this is a great opportunity. Yeah, we could just jump to that. Sure. The IP, congrats on the recent win. For people who are less familiar, can you talk about what the IP situation is, how it's settled down, and what's left on the table? Sure. Steve's our resident expert in that regard. I'll turn it to him. Thank you. Thank you, Rich. For the intellectual property, we had a total of four generic filers. Three of them are first filers, the way the FDA defines paragraph four challenges. We have now settled with three. One was a second filer, and one was two of the first filers. There's one first filer remaining, Hetero, who is the remaining litigant, who under Section 406 conferences we continue to have discussions with. Like the other companies that we have settled with, most recently was Lupin, we will listen to what they have to say. If they have something that's in the best interest of the shareholders, we'll act on it. The completed settlements, where does that take your intellectual property to? That takes the entry date for the current three settlers to February of 2035. OK, awesome. IP question done. Jennifer, I think it's important too, you know, most products only get an average life of seven years. This product's already been on the market for six. One of the challenges we gave to the brand team was, what would you do if you knew you had 10 years of life left? How would you act differently? What you see are these titration programs, the oncology program. They're treating it as if it has a fresh life, and we're investing appropriately in the opportunity. Yeah, I mean, that is a big question. It's been a few years on the market. How sustainable is that growth? You talked about the different levers and opportunities. Maybe focusing on the growth you're seeing today, you talked about titration being important. I guess this year, how much of the growth that you're seeing has been driven by the titration strategy versus volume versus price? Any color you can give around that? Sure. It's a little hard to separate the titration from the volume growth because it's one and the same. We expected, about a year ago, we got approval to go from a max dose of 80 mg a day to 100 mg. We expected that there would be about a 5%- 10% increase in that dose, and we're on track for that. Neurologists who are the primary physician on the idiopathic side are notoriously conservative, and appropriately so. We expected that to take a number of quarters to actually see that growth at 5%- 10% growth. Price is not a big driver for us. It is a volume-driven opportunity. We are not taking significant or huge price increases, and we don't actually realize much of the price increase that we take. Really, we are looking to drive volume for the growth. We're not a price player. We believe that there's sustainability in this 15%- 20% growth for the long- term. OK. Guidance for this year in FIRDAPSE, $355 million- $360 million. You said conservative estimates, the peak opportunity could be $1.2 billion. Correct. Of that incremental or substantial growth opportunity left over, how much of it is driven by the idiopathic opportunity versus the cancer-associated? We have about 30% penetration on the idiopathic, as I said before. I think there's significant upside there. Again, those are patients that are hard to find. Fewer of them are diagnosed in any year. They live a long lifetime. You think about both of these populations are of equal size. When you think about the math around that, if a small cell lung cancer patient lives eight months and your idiopathic patient lives a full life, you know in every year, there are more small cell lung cancer opportunities. The way the math works out is it's about 3%. LEMS patients are about 3% of all small cell lung cancer. The straight math is about 900 new patients a year, which is significant. Whereas you're seeing on the idiopathic side, maybe 50, 60, 70 a year. The interesting thing about cancer-associated LEMS is that a small cell lung cancer patient will only live eight to nine months on average. That's typical. The reason why we talk about small cell lung cancer is because LEMS is predominant in small cell lung cancer. That's where you see most of the cancer-associated LEMS. The small cell lung cancer patient with LEMS lives an average of 17- 18 months. Steve can get into the reasons why and the theories. Nobody really knows why. When we talk to the oncologists, they say, I didn't know that. It makes me want to do more for the patient, knowing that they're going to live a year and a half as opposed to eight to nine months. We see this opportunity as great. When you just do, again, the straight math on a Kaplan-Meier curve, 900 diagnosed a year, 1,700 are alive at any point in time. 82% of those are addressable. We don't address the ones that can be diagnosed as positive, but have no symptoms. On the other end, those that are so sick and bedridden and really can't walk, probably are not going to get therapy. That leaves 82% of all of these patients as addressable. We can make a difference in their lives. That's how we come up with the math. We think that's an opportunity. We're less than 10% penetrated on the oncology side. We think that's huge upside. The concentration of those patients, the change in the guidelines, the accessibility of testing, all of those things, I think, are the biggest drivers for us going forward. That was actually going to be my next question. It seems like the majority of the cancer-associated LEMS patients remain undiagnosed. You touched on sort of the levers that are helping drive that change. Are you seeing that change now? What really are the levers that have to change? That's a great question. We see this as a 2026 and beyond opportunity because to change the guidelines, we got those two months earlier than we thought. Now, moving to the large practices and trying to drive those through their individualized care pathways takes time. We see this as that's what we're doing right now. We got a jumpstart with our dedicated resources to the oncology community. We have two, as I mentioned, and we started that in May. Now that we got the guidelines two months earlier than we anticipated, we're really driving that. This becomes more of a 2026 and beyond opportunity for oncology. OK. Can we touch on the pool of patients that you sort of constantly refresh? Just break down the idiopathic contribution versus the cancer contribution. It mirrors the rest of our business. It's difficult. Sometimes the first sign of small cell lung cancer is a patient who reports with Lambert-Eaton myasthenic syndrome. That's a heads up for the doc to, hey, watch out. This patient could develop it. About 20% of our patients are small cell lung cancer today. That mirrors the pool that we have as well. The pool of patients that we constantly update, refresh, and reprioritize is what is driving, as I said earlier. About half of the new patients that we get in any given quarter come from this pool. It's very productive for us. It's very good for the patients. It helps us identify through artificial intelligence and through tracking data in the marketplace. One of the most interesting things about this pool is the most frequently misdiagnosed diagnosis, if you will, is myasthenia gravis. All of this activity around myasthenia gravis right now and all of the advertising, direct-to-consumer advertising, benefits us. More patients will get diagnosed with myasthenia gravis. Consequentially, more patients will be misdiagnosed. The MG therapies won't work. They'll be looking for the next alternative. This is a really good opportunity for us to help more patients as well. The 80% of the pool that is currently idiopathic, you said it's more of a prospecting business. Yes. I guess, what are you doing to find these patients? What drives your confidence that you'll be able to refresh that pool? We look for patients who are, through data, we look at practices that are treating patients with myasthenia gravis and may have failed a number of opportunities. We don't know the name of the patient. This is a totally compliant program. We know where they are, and we can go and say to the doctor, we see that you have a patient with myasthenia gravis, and they have failed a number of therapies. They've been on Mestinon, they've tried IVIG, et cetera. We put together not only the diagnosis, but also the treatment, and we know the locale. Through geospatial relationship, we know where that patient is based on the data. We can send a sales representative in and find out where that patient is in their diagnostic journey. The diagnostic journey for a LEMS patient is between four and six years from first symptom to actually getting to FIRDAPSE. Our goal is to shorten that as much as possible. We use all of these data sources, put them together, and we have a proprietary algorithm to do that. OK. Maybe we can turn to AGAMREE now. Sure. OK. Walk through uptake since last year's launch, where market share is today, and give us a vision of where you think it can go. Market share is really tough to see in this marketplace because we don't report. The makers of Influenza don't report. We all have to triangulate to where we think we are. We've had really solid uptake. We are sourcing our patients, and this is a really good indicator of the value that we create. We thought when we came to market, we would source our patients from Influenza. Prednisone is the first drug. Influenza is the second drug. What we're seeing is 45% of our patients come from Influenza patients, 45% of our patients come from prednisone, and 10% come from naive. They don't have any experience with a steroid. We're playing in 100% of the market. Our best understanding of where we could triangulate Influenza's market share at the time of our launch was about 35% market share. Rather than playing in just 35%, we're playing in 100% of the market, which we think is tremendous. It gives us really great confidence going forward. Can you talk about the impact you've seen so far from generics for deflazacort? How do you expect that to change, maybe thinking about 2026 and beyond, not only on the volume side, but even like access or pricing? The average age of our patients is 12 years of age. That means they're at the pivotal point where they're about to lose ambulation. Any patient who's on a steroid actually walks for two to two and a half years more. Foundational therapy. These patients, though, the average age is 12. They've already been through prednisone. They've already been through deflazacort. No payer is going to make them go back and try generic deflazacort. That's illogical. We're getting these patients who are, in their minds, failing therapy or couldn't look for a better alternative. We're not seeing blocks, which is good. As we go forward, we expect that ratio to the source of patients to change because there will just be fewer deflazacort patients over time. We are effectively the only voice in this market now. PTC has essentially stepped out. Prednisone has no voice. Generic deflazacort has no voice. We really feel like if we can prove the benefits through the Summit study that we're running, we can really drive what we would call an unfair share because we have a superior product. I don't know if you want to talk about Summit. Of course, that was my next question. Great. Steve's our man for that. It has been just over a year since you started Summit. Can you just, first of all, remind us what Summit is designed to show? Is there anything you can say on how enrollment is going and timing on when we could see data? Sure. The Summit study is an open-label study in which we're recruiting patients who are on commercial AGAMREE. We are studying a number of safety signals in that patient population, including bone health, bone growth, bone density, stature, cardiovascular effects of the drug, and the patient's condition, as well as mental status and anxiety and aggression, which is a common feature of corticosteroids. The main purpose of the Summit study is to evaluate those safety signals and find well-controlled clinical data that we can submit in a drug application and modify our product insert sheet to include the additional safety information for the physicians so they can differentiate AGAMREE from the other corticosteroid choices that they have available. In order to do that, we need a sufficiently large N. The other thing that we need is a sufficient amount of time after a patient's been recruited to observe a change in that patient's condition over time. We're well into the recruiting, but we still have some time to go before we have a sufficiently large N. Once we've achieved that N, we also need to observe the patients for a while. I would presume that we probably will not have data, well-controlled data to present for about one and a half to two years. That will be the data that ultimately will be submitted to the FDA. The good news is it's an open-label study, so we can also do descriptive statistics on just what's happening to the patients in real time and present that in publications, as well as at professional meetings for physicians. We'll be doing that at various meetings in the future as time proceeds. Also, I want to say, Jennifer and Steve, while we're doing this study, it's important to realize that many of these benefits and differentiations are actually in the European label. We can't promote that in the U.S. The data exists. The data are there that patients have better behavior, better bone health, better stature, et cetera. The data are out there already. This is to change our label in the U.S. This is a very tight community, and they follow the development of drugs, as we all know. Many of these patients, caregivers, and physicians already know that the data is out there. Obviously, we can't promote it, but I just wanted to say we have great confidence that the study will deliver. Much of it's published as well. Right. OK. You were saying, one and a half to two years until you have the data that you could potentially file. We could see sort of an early look ahead at that. We'll give early views into the data in the form of descriptive statistics without the control group. Am I able to ask, in terms of the one and a half to two years, what is an adequate N? What's an adequate follow-up? It's going to depend on the safety signal. For example, the aggression and anxiety show up almost immediately, or I should say the lack of it in the case of AGAMREE, whereas in other corticosteroids, it shows up right away. That's something that we should have good data for pretty quickly. The bone growth, bone health, bone density are going to be intermediate in terms of timing. The cardiovascular health is going to be the longest-term safety signal that we'll be looking for because that takes a long time to develop in patients who have DMD. The flip side of that is it will take a long time before we have definitive proof because we have to prove a negative that the drug is, in fact, much safer for these patients from a cardiovascular safety point of view. With those different measures, what is the strategy in terms of leveraging those different, I guess, measures? Is it to drive usage in different populations? Is it to help with access? What is the thinking there? The strategy is really to get the drug to where the benefit can accrue to the patient. If a patient is growing and they're laying down bone, but they're also growing in stature, get it to that patient. Cardiovascular is a long-term issue. The earlier you get it, and our label indicates the patient could be on as early as two years of age. Right now, we're seeing a positive movement in the average age, which means it's going down, which is good. We actually want to make sure that that patient who can benefit from the therapy gets the therapy. That's going to take time. Early adopters are there. Late, early adopters are starting to come on. Over time, more and more physicians will obviously see it. Get it to where it can actually make a difference for the patient. A lot of the pushback we get sometimes is, you know, this young man's going to be in a wheelchair. What does stature matter? Personally, my response is it matters to the young man. If you want to say to your peers, I'm 5'8", just like my friends, or I'm 5'6", just like my friends, that matters. Even if you're in a chair, it really matters. To maintain ambulation for a longer period of time. When a young man goes into the wheelchair and his world is now controlling the chair and the internet, being able to use your hands and have great dexterity becomes really important. Staying on steroid matters to these young men. All right. Mind if we touch on balance sheet and BD? No, go ahead. OK. You have, I think, north of $650 million on the balance sheet. Your capacity for opportunities grows every quarter. How would you characterize your current appetite, strategy, and priorities for BD? We would be appropriately aggressive. We think of three elements to business development. One is that we need a differentiated product. Two, we have to be able to make money. That's important to us. Three, we need to have a social element where we get along with the other company if we're licensing or we're absorbing a company. Social, I've run two major integrations in big pharma, and social is always the most underestimated one. We are appropriately aggressive. Our capacity is we're looking for products under $500 million, at $500 million, or below peak because different companies show up at that auction if it's above that. We don't want to compete with those larger companies. We are appropriately aggressive. We get asked all the time, is there urgency? The answer is yes. It's urgency to do the right deal, a deal that fits with us and will provide for patients and for shareholders as well. I know you said you have an agnostic approach. Are there certain therapeutic areas under orphan and rare disease that might make more sense than others? With the recent change and the legislation that came out, that a second indication is OK, and you won't be subject to IRA price negotiation in orphan drugs, we're looking for those drugs that have potential for more than one claim, like we believe AGAMREE might in other steroid-dependent conditions. Pediatric, I think, is a special case we really have a lot of passion for. We're looking for opportunities there. Now that our entry is we've gone into oncology, we're serious about opportunities for oncology as well, as long as it's orphan. OK. Maybe a last question. Key value drivers that investors should pay attention to over the next 12 months? I think enrollment in the Summit study becomes really important. This is something that's very important to us as a company. It's going to be hard to measure the impact of all the things we've done in oncology for LEMS directly. The indirect measure is testing. How prevalent is testing? Because testing is the only drug that's approved, evidence-based drug. If we get tested, if a patient gets tested, we'll get used. I think those are the real value drivers for us. OK, great. Richard and Steve, thank you so much for joining us today. Jennifer, thank you. Thanks very much.